By Cody Willard

The entire concept of the cloud as an industry has been around for more than a decade, but it’s only now that the tectonic plates of technology are aligned for the Cloud Revolution to take off. As ubiquitous broadband becomes a reality, as the cost of data storage has continued to plummet for decades now and as processing powers in smartphones, tablets and car dashboards surpass what the best PCs could do just five years ago, we’re all moving toward consuming, storing and accessing our information, entertainment and work in the cloud.

The Cloud is going to be one of the biggest growth industries in the history of business. And in our new book, “30 Stocks for the Cloud Revolution”, we’ve identified the 30 companies best positioned to benefit from this huge new tech sector.

Rackspace is one of the most volatile tech stocks on the planet, often way overshooting to both the upside and the downside. I’ve seen the longs make 500% in this name and I’ve seen longs lose 90% in this name. In fact, the stock is up some 9-fold from its lows in early 2009, but that is in large part because the company has finally gotten their business stabilized and showing consistent, steady growth. The company is expanding into Asia and the rest of the world, even as it continues to show huge growth domestically as companies move to the cloud. The problem with this one is both the valuation and the fact that it’s already moved some 800% in the last eight quarters. It will likely eventually grow into the 38x forward multiple and it might be acquired before it can, but it will take some time.

Revolution Investing Rating: 5/10

For each of the 30 stocks we’ve identified as most widely exposed to the Cloud Revolution, we give a brief description of each company’s primary businesses and outline some of the most important balance sheet and business fundamentals. Rather than just going with a simple P/E, we break down the enterprise value of each company, which makes companies that have huge cash balances and lots of flexibility look cheaper than those carrying big net debt loads around their necks.

From there I give you some of my trademarked cut-throat Revolution Investing analysis including some history of the company, how it’s trying to position itself for the Cloud Revolution and how much I like or dislike the investment prospects for that company.

And for those of you who really just want a short hand rating system, don’t worry. I put a Revolution Investing rating from 5 to 10 on each stock (I didn’t include any of the dozens of lower rated Cloud Revolution Stocks we researched). Indeed, the aforementioned Rackspace is one of the lowest rated stocks in the book. To find out the highest rated stocks, just get your hands the new eBook, “30 Stocks for the Cloud Revolution”, by visiting CloudRevolutionStocks.com or by subscribing to TradingWithCody.com, where you get access to all my investment books for free.

At time of publication, Willard, author of Revolution Investing and Trading With Cody, had no positions in the stocks mentioned in this column although positions can change at any time. None of the information in this column constitutes a recommendation by Willard of any particular security or that any security or trading strategy is suitable for any specific person.

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About The Cody Word

Cody Willard writes the Revolution Investing investment newsletter for MarketWatch and posts the trades from his personal account at TradingWithCody.com He is the founder of WallStreetAll-Stars.com and the principal of CL Willard Capital. Cody serves as an adjunct professor at Seton Hall University and is on the University of New Mexico Alumni Board. He was an anchor on the Fox Business Network, where he was the co-host of the long-time #1-rated show on the network, Fox Business Happy Hour. Cody, a former hedge fund manager, and his stock picks and economic outlooks have been featured on NBC’s The Tonight Show with Jay Leno, ABC’s 20/20, CBS Evening News, CNBC’s SquawkBox, Jon Stewart’s The Daily Show, as well as in the Financial Times, Wall Street Journal, New York Times, and many other outlets.